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Fiat Chrysler confident after record profits in 2016

Italian-US carmaker Fiat Chrysler (FCA) said Thursday it is confident of reaching its medium-term earnings targets after the group delivered "record results" last year.

PHOTO: REUTERS

[Milan] Italian-US carmaker Fiat Chrysler (FCA) said Thursday it is confident of reaching its medium-term earnings targets after the group delivered "record results" last year.

FCA, which was recently accused by the US authorities of cheating on diesel emissions, said in a statement that its bottom-line net profit soared to 1.8 billion euros (S$2.697 billion) in 2016 from 93 million euros a year earlier.

And on the basis of its "record 2016 results," the group "confirms (its) conviction of achieving its 2018 targets," the statement said.

The news sent Fiat Chrysler shares sharply higher on the Milan Stock Exchange, where they surged 4.2 per cent to 10.64 euros while the overall market was up 0.7 per cent.

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FCA said that group sales amounted to 111 billion euros, "in line" with the 110.6 billion euros reported in 2015, but short of the full-year target that the group had set itself of more than 112 billion euros.

In terms of the numbers of vehicles sold, FCA said unit sales were stable at 4.7 million in 2016, but its Jeep division turned in a very good performance with unit sales rising by nine percent to 1.4 million vehicles.

FCA said it also achieved its aim of bringing net debt below five billion euros to 4.6 billion euros in 2016.

For 2017, FCA said it is pencilling in revenue of 115-120 billion euros, adjusted net profit of more than three billion euros and net industrial debt of below 2.5 billion euros.

And for 2018, the group is targetting sales of 136 billion euros and adjusted net profit of 4.7-5.5 billion euros.

Fiat Chrysler chief Sergio Marchionne had said on January 13 that the group was sticking to its 2018 targets and rejected the accusations of using software on its trucks to evade emissions standards on about 104,000 vehicles in the US.

The US Environmental Protection Agency said the undisclosed software on the 2014 to 2016 models of Grand Cherokees and Dodge Ram 1500 trucks sold in the United States allowed the vehicles to emit more nitrogen oxides than permitted.

FCA made no mention of the affair in its earnings statement on Thursday.